a dollar at above 0 to 25 basis points for 2023? i think it's a 9-9 vote and it's on a knife edge and possible to say given the outlook it doesn't say to keeping rates flat into 2024. >> take a look at the marketings right now because we are going to go to steve liesman for the fed decision steve? >> the federal reserve leaving interest rates unchanged but changes to its forecast. first the ones that didn't change, the median funds rate for the forecast sees no hikes through 2023 that's the median. there were some changes. get to them in a second. inflation at or above 2% through this year and 2.4% this year for the pce indicator. lowered the employment forecast. going to 3.5% by 2023 and

boosted the gdp forecast, this is the average or median forecast for all fed 0 fofficia to 6.5%. talking about the famous dotds, where are the fed officials coming to the rates? four officials see 2022 rate hikes up one from the december projection seven officials see 2023 rate hikes up from 5 but still no change in the median because only a small number continue to call for those rates get to the statement now the fed saying or new change in the statement that economic and employment indicators have turned up recently though sectors affected by the pandemic have remained weak and sees inflation below the 2% target and using the boilerplate language from prior statements committed to using the full rang of the tools

and policy will remain accom accommodative until reaching the goals and asset purchases will continue until further progress is made. the decision is unanimous. >> on inflation, they see for the full year even though it's running below 2% for the full year of this year 2.4% inflation, 4.5% unemployment this year dipping to 3.5% by 2023 how close are they really and what is the implication for policy how close are they really to that dual mandate imperative to hit which is inflation of 2% or maybe a little above and full unemployment which is i don't know what it is, 3.5%, 4%? >> well, i have to amend your question if you will with all due respect. >> sure. >> remember the goal is to aim for inflation above 2% so hits

it this year and maybe it hits that goal and goes back down to 2% and it gets to 3.5% unemployment now. i have to take a guess or a stab and say that's the goal back to the prior low unemployment rate so that doesn't happen until 2023 so the dual mandate if you take these literal and make assumptions about where the goals are they don't hit the dual mandate until 2023 and they don't see themselves really even raising rates there. the median forecast for the funds rate in 2023 remains 0.1%. longer run goal or potential is 2.5 pistons for the funds rate. >> let me ask you, a quick follow up here you said the four of the members expect rate hikes, the first rate hike in 2022, next year seven predict it for 2023. how big a difference is that

from just the last meeting i think you said only one who was going to go on the record saying rate hikes coming in 2023 or 2022? i have forgotten. >> 2022. two separate documents here and will tell you what the story is. so there was one prediction for a rate hike in 2022. that's now four. three became -- brought it forward. five forecast for 2023 rate hikes back in december, the last projections and now they're seven. >> how big a change is that? put that in a context. is that more than people expected roughly what you might have expected how is it fit in historically? >> i think it's in line. look during the pandemic and the middle of the pandemic, we had nothing but doves on the fmoc panel. david kelly was talking about

9-9. what we are seeing is a separation back to maybe some traditional stances that some of these fmoc members took which is some members are more hawkish, want to move faster. some more dovish i think when you have situations like that, most important question, where's the chiairman the chairman is dovish to keep rates down and policy in place until they achieve the dual mandate. it's significant and differences of opinion but the full weight of the board remains behind the dovish policy. >> thank you courtney >> thank you: i want to get back to the panel for the reangst mona, there's a lot to work with here do you want to talk about the inflation expectations or the policy to remain accommodative that's not a super surprise.

you tell me what was most surprising to you then in the statement from what steve just read to us. >> it almost feels like a defacto easing 6.5% is above consensus. unemployment rate down to 4.5% this year is also below what the current con sensus is and taking down expectations of unemployment but leaving rates through 2023 essentially is in some ways a continuation of this very easy, very accommodative tone the good news is back in november the fed changed the average inflation targeting regime and now even if the forecast comes to fruition and get inflation back above 2% we know that the fed's reaction won't immediately be to think

about raising rates and may have let it run hot and that period of time is unspecified but i think the good news for investi investors is this is an accommodative fed still and maybe they added easing to this. the other quick point to make is that investors are watching rates and what it does to rates. we are looking at an amount where growth is accelerating and unemployment is coming down. keep in mind in the ten years prior to the pandemic the average 10-year rate was 2.2% and the average growth rate is 2.3% this isan environment where gd growth is much stronger than that 2.5% type growth and yields are still at 1.6, 1. 7 and something to think about in the next few quarters. >> john, mona made a number of points including the policy.

is there a danger in remaining too easy for too long? what should we be on the lookout for? >> i agree with mona it was more accommodative than expected. not changing the dots is a dovish surprise but a useful reminder the fed is not reacting to gdp numbers and the outlook of six months and the market has really gotten focused on big gdp numbers this year and what's going to happen especially with the stimulus and the reopening and it is a useful reminder the fed has a dual mandate, inflation and labor markets. not gdp. both have big question marks on them inflation is unclear what's going to happen over the medium term and the fed with a medium-term objective to aim for so i think the fed did add some accommodation and i would agree with mona about that and reminding you they're not

reacting to gdp and six months but the labor markets and inflation. they have a more medium term outlook. finally say you asked about risks. i think the fed is very focused on the downside risks and what could happen there's a lot of them. that's traditionally where the fed has run into trouble when the economy slows and they can't add enough accommodation people are worried of upside risk i think the fed's reasonably confident in dealing with that the fed is worried what if they need to add accommodation and where would that come from i don't think that focus changed from the fed. >> david, john just mentioned not so focused on did gdp but the forecast there as mona pointed out is stronger than consensus. what do you make of that forecast and what powell is trying to say with that and following the path of the virus?

>> i very much agree with the economic forecast. i don't think there's much disagreement with them in terms of where the economy is going and red hot over the course of the year and raises the question of tapering bond purchases and this is more likely to taper them early in 2022 you have to say that those numbers in the fourth quarter this year. you have got to say that's substantial further progress towards the goals. then it's a question of most members of the committee even though they saw themselves at full employment and inflation 2% and see that for 2023 they don't want to put that rate hike in there and scared of spooking the bond market and the bond market can take it or the economy can right now. we will have a boom either way i would rather to see the interest rates when it can

handle it. you do need to normalize rates and much more difficult to do then and take advantage of the huge momentum that's building in the economy to try to get at least some way towards a normalizing monetary policy because it will be more difficult later. >> mona, david seems to be saying that the greater risk is waiting too long to move do you see it that way >> his point that the fed has to acknowledge that they're making progress towards the dual mandate, putting it in the forecast, unemployment is improving, inflation is picking up and that is undeniable at least this year. it also extends to next year potential growth in the u.s. is between 1.5% to 2% and looking at 4.5% growth in 2022 also a very strong economic year. to david's point, at some point over the next two years it would

actually make a lot of sense for the fed to think about at least tapering the asset purchases the accommodation level they have right now is crisis mode accommodation level. this is the heart of the pandemic they needed to bring rates lower bound and increase the balance sheet to offer liquidity clearly seeing signs to leave crisis mode and starting to exit crisis mode and call for a change in the accommodation level. really they should do it in a way to communicate it well in advance and hopefully the markets can digest it. we are starting to digest higher treasury yields and in some ways if you think about it the higher federal funds rate is a good sign that the economy is improving. some ways you want inflation look at japan and europe been in stagflation it is a healthy sign

to see the u.s. picking up. >> i want do get david first and then john with a quick observation on how the equity markets responded to this relatively dovish set of information that they have received both the nasdaq is up and the dow has jumped david, is that what you would have expected? >> yes if the federal reserve continues to -- whatd federal reserve is doing and has for many years is fuel a huge bubble or boom certainly, maybe not quite a bubble but a boom in financial markets. these super low rates make it easy to finance investments in fixed income they have to worry about the boom turning to a bubble to some stage. >> john, the market is clearly cheered or the equity market is cheered by what it's seen. >> i think the fed is clear to be patient through the reopening

and this year. they don't want to adjust monetary policy in this period and make it tighter. to the extent people worry about that they should be relieved today. >> steve, do you think that in this upcoming press conference powell as always needs to be careful with the words but perhaps even more so this time kind of being one of the great w walinda's walking the tightrope? >> yes, he does. i want to underscore how historic what we have seen today is mona underscored it. the fed told us that its reaction function was changed. and it was easier. we have never seen what we're seeing now in terms of the forecast for the fed and its connected or parallel folk for

the funds rate the way it is now. all due respect to alan meltzer would not stomach this 6.5% growth, no change in policy 3% growth. 3% growth. no change in policy. and a 2% inflation rate. no change in policy. this is the first time the markets are seeing this change in policy from the federal reserve in numbers and i think that's why the market is cheering it. courtney, fed chairman powell has to do everything he can not to change the way the market reacted to this. they seem to be accepting it and it seems to be going okay for him at this very moment. >> steve, thank you very much. our thanks to our guests

meantime, as stocks move higher cheered by the fed report let's get to bob pisani for the market reaction robert >> this is a thread the needle story for them: they upped the growth forecast. they say no rate hikes through 2023 even if inflation overshoots a little bit. bond yields stable making that announcement and move up 20 points on the s&p in positive territory? they have threaded the needle. just take a look at the sectors. throughout the day because yields were high we are the usual situation, the reflation stocks, all of these have improved tech is also well off the lows now and some going positive so the overall market has lifted.

the clean energy, the solar stocks were lower here and improved throughout the day. inflation and yield worries replaced covid worries and the fed's dilemma is acknowledging growth improved without bringing forward the timeline, at least in terms of this announcement they have done that we'll see how he does in the press conference back to you. >> thank you very much, bob. now let's go to chicago. i'm sure rick san ttelli has thoughts on what we heard from the fed. hi, rick. >> hi. yeah i will have to disagree with everybody. what's the prince song "when doves cry. let's look at the only market that i think gave us the true

unvarnished answer of anything other than doves in the sky. that's the dollar index. rates didn't really give up any ground so why did the dollar do what it just did you can see the dollar was just shy of 92. now look at where it is. that shows that the ultra uber dovishness is not considered a good thing for the country with the reserve currency if you look at 2-year note yields 15 basis points now at 13 that's another clue as to what's going on because the short end of course is hooked into the fed most closely if you look at 10s what's fascinating here is it was at 166, the high was 168. you could see it's contained but don't get too excited about contained but here's the one to watch. the 30-year bond the longest maturity at the

highest intraday yields should it close above 242, 242 since august of 2019 and if you look at it it took out the earlier intraday high. a fresh new cycle intraday high and pretty much between that and the dollar index and the yield curve doves continue and invest investors continue to fade back to you. >> thank you we have breaking news out of washington let's go to ylan for the details. >> reporter: tyler, the treasury department does plan to extend the tax filing deadline by one month from april 15th to may 15th this comes as the agency faced growing pressure from both democrats and republicans to give people more breathing room to file the taxes in the middle of a very complicated financial year and also allow the agency sometime to implement president biden's american rescue plan sending out the stimulus checks, giving out the expanded child

tax credits, treating unemployment insurance differently. so americans will have more time to file the taxes, the deadline now may 15th the treasury department coming under fire from ohio which is now suing the agency over some of the limitations around state taxation that come as part of the aid given to states in that rescue plan. there are a number of states that sent a letter to the treasury department, 21 states, calling for them to reconsider some of the strings that come attached to the covid relief guys >> so what is -- xexplain to me what the states' beef is with the american rescue act, specifically. >> reporter: as far as i can understand it, i haven't been able to read ohio's lawsuit all the way through but states are concerned they were prevented from being able to cut state taxes if they receive money from the coronavirus relief fund. they're saying that's overreach

by the federal government and an unconstitutional intrusion into the powers and now filing suit or threatening to file suit against the treasury department in oshrder to prevent that from happening. >> it's a court issue, not so much a legislative issue it would appear that is from me sitting here and not someone as knowledgeable as you are about the ways of d.c. court, take it away. >> thank you very much. coming up, we are less than ten minutes away from the chairman's press conference but we'll ask a former fed president who powell needs to say tooo c keep the markets happy we see harnessing natural gas unleashing the promise of cleaner energy.

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stocks have rallied at the federal reserve announces to keep rates unchanged for really foreseeable future saying it sees inflation at or above 2% through 2023 four officials now see a rate hike next year so what is the risk if the fed doesn't tighten or tightens too soon let's bring in larry meyer, old friend welcome and welcome back and delighted to have you here you have been in these conversations at the fed and i would like you to take us behind the closed doors as more of the governors seem to be saying interest rate hikes will or

should come sooner what is the conversation like? what is the back and forth like? >> actually that's interesting 11 said no hike in 2023. only one said one hike but five said three or four hikes. oh, the fmoc meetings are going to be very, very interesting i think the story here is that -- the story is that still while the economy is better, stronger, there's still a long way to go to get to their goals and that's basically the story to make the no hike this time consistent with the forecast i think another thing is that they don't forecast 2024 so what would powell say i think that's an overshoot there. the forecast that held them back a little bit. so there's a little bit more danger to go too slow and a main

reason is that constraint for moving away from zero until inflation is 2% for a year and they believe it's going to overshoot. they have never kept the funds rate unchanged under those circumstances. that's remarkable and that's the new guidance, it is supposed to be accommodative to get inflation up to 2% and overshoot. so that means that - >> you leave interest rates where they are, right? despite that it may overshoot that goal. >> right we're talking about 2023 >> yes. >> so keep them the same until it's at 2% for a year. they expect it to overshoot. in the following year. >> larry - >> go ahead. >> continue your thought, larry. >> so this is not at all a

surprise and it doesn't tell us very much about whether they're going to go too fast or too slow. so we'll have to see 2023 is a long way off as the chair always likes to say. the crystal ball is very cloudy out there. don't pay too much attention to the dots in 2023 and he's right the forecast is wrong. we know that it's always wrong. we shouldn't pay all that much attention to it. some perspective on what the individual members are thinking. >> what about a tapered timeline is it still appropriate for the fed to be making the purchases at the level at which they are and when does powell need to forecast that more clearly for the markets? >> it's certainly not for the foreseeable future they can see when they need to

taper. it is when there's significant progress very vague it is in the eyes of beholder and interesting discussion within the committee i think that if you look at them and they have a 4.5% unemployment rate i think that's not quite low enough i think it has to be clower to 4.25 what we expect like 4.2 and inflation at least 2%. so i think that's probably beyond this year in the first quarter or at most second quarter of next year. one quick question before we have to leave you. did i hear you correctly then that you think that the earliest they will begin tapering the asset purchases is next year? when might they single that? >> earliest is december.

it is more likely to be in early next year. >> all right governor meyer, thank you for being with us. >> a pleasure. >> always good to see you. thank you so much. as we wait for jay powell, we said at the top of the broadcast that this meeting feels a little tonally different and we have gotten that in the changes of when certain governors expect interest rate hikes. it is not a dramatic change but it is a subtle and notable one. >> notable for the markets, too. we saw pretty notable moves in all of the major indices the nasdaq is slightly negative again and it did go positive in reaction and chair powell will have to walk a very careful line in this press conference because the numbers when you're looking at the economic metrics don't necessarily outside of anything

else match up with what the fed is currently continuing to do. it looks like things are massively improving but the fed policy is very, very accommodative. >> you have since the last meeting nearly $2 trillion worth of stimulus coming online. checks going into people's pockets and bank accounts this week in a big way something that i don't know whether he counted on that but let's find out what he has to say because here is chair powell. >> i would like to start by noting it is a full year since the pandemic arrived on the shores it is clear that addressing the fast moving pandemic would be the realm of health care providers and experts and we are grateful to them and the essential workers for the service and sacrifice. the danger to the u.s. economy was also clear congress provided by far the fastest and largest response to

any postwar economic downturn. offering fiscal support. here at the federal reserve we rapidly deployed the full range of tools to provide relief and stability, to ensure that the recovery will be as strong as possible and to limit lasting damage to the economy. we are strongly committed to achie ach achieving the goals. maximum employment and price stability. the economic fallout has been real and widespread but with the benefit of perspective we can say some of the worst economic outcomes have been avoided more people held on to their jobs more businesses kept their doors open more incomes were saved as a result of these swift and forceful policy actions and

while we welcome the positive developments no one should be come place ent we'll provide the economy the support it needs as long as it takes. today the fmoc kept interest rates near zero and maintained the sizable asset purchases. these measures along with the strong guidance on interest rates and on the balance sheet will ensure that monetary policy will continue to deliver powerful support to the economy until the recovery is complete the path of the economy continues to depend significantly on the course of the virus and the measures undertaken to control its spread since january the number of new cases, hospitalizations and deaths has fallen and ongoing vaccinations offer hope for a return to more normal conditions later this year. in the meantime, continued observance of measures will help us reach that goal as soon as possible the economic recovery remains

uneven and far from complete and the path is uncertain. following the moderation in the pace of the recovery that began last year indicators of economic activity and employment turned up recently. although sectors remain weak household spending on goods has risen notably so far this year in contrast household services paid is low. including travel and hospitality. the housing sector more than fully recovered from the downturn and business investment and manufacturing have picked up the overall recovery in economic activity since last spring is due importantly to unprecedented fiscal policy actions which have provided essential support to households, businesses and communities. the recovery progressed more quickly than generally expected and forecasts from fmoc

participants for economic growth in career is revised up notably since the december summary of projections. in commenting on the stronger outlook participants noted activity of vaccines conditions in the labor market turned up recently employment rose by 379,000 in february as the lee shush and hospitality sector recouped about two thirds of the jobs lost in december and january nonetheless, employment in this sector is more than 3 million below the level at the on set of the pandemic for the economy as a whole employment is 9.5 million below the prepandemic level. the unemployment rate is elevated at 6.2% in february this figure understates the short fall in employment, parti particularly participation in the labor market is below prepandemic levels

looking ahead, fmoc participants project the unemployment rate to continue to decline. the median projection is 4.5% at the end of the year and moves to 3.5% by the errand of 2023 the economic downturn has not fallen equally on all americans and those least able to shoulder the burden have been the hardest hit. in particular, the high level of joblessness is especially severe in the service sector and for african americans and hispanics. the economic dislocation unended many lives overall inflation is below the 2% longer run projection 12-month measures will move up as the very low readings from march and april of last year fall out of the calculation. beyond the base effects we could also see upward pressure on prices if spending rebounds quickly as the economy continues to reopen.

particularly if supply bottlenecks limit how quickly production can respond in the near term. however, these one-time increases in prices are likely to have only transient affects on inflation the median inflation projection of fmoc is 2.4% in year and declines next year before moving back up by the end of 2023 the fed's response is guided by the mandate to promote maximum employment and stable prices for the american people with the responsibilities to promote the financial -- stability of the financial system as we say in the statement w view maximum employment as a broad based goal the ability to achiever maximum employment is longer term inflation expectations well anchored at 2% as the committee reiterated in

today's policy statement with inflation running below 2% we will aim to achieve inflation moderately above 2% for sometime so that inflation averages 2% over time and longer term inflation expectations is well anchored at 2% we expect to maintain an accommodative stance until the employment and inflation outcomes are achieved. with regard to interest rates we continue to expect it will be appropriate to maintain the current 0 to one quarter rate until labor markets reached levels consistent with the assessment of maximum employment and inflation is 2% and will exceed 2% for sometime a transitory rise of inflation above 2% seems likely to occur this year would not meet thi standard in adegrees, we will continue to increase the holdings of treasury securities by at least $80 million per month.

until substantial further progress is made to the maximum employment and price stability goals. the increase in the balance sheet since last march materially eased financial conditions and providing support to the economy the economy is a long way from the goals and it is likely to take sometime for further progress to be achieved. our forward guidance for the federal funds rate along with the balance sheet guidance will ensure that the stance of monetary policy is accommodative. our guidance is outcome based and tied to the path of the federal funds rate and the balance sheet to progress toward reaching our employment and inflation goals. overall our interest rates and balance sheet tools are providing support to the economy and will continue to do so to conclude, we understand that our actions affect communities, families and businesses across

the country. everything we do is in service to our public mission. we are committed to using the full range of tools to support the economy and assure that the recovery from the difficult period will be as robust as possible thank you. i look forward to your questions. >> from reuters. >> hi, chair powell. thanks for that. could you talk us through how the forecast for 2021 maps into the progress definition? 2.4% inflation, considered transitory that's still seems like some progress there 4.5% unemployment. is it time to start talking about talking about tapering yet? >> not yet so as you pointed out, we've

said that we would continue asset purchases at this pace until we see substantial further progress and that's actual progress not forecast progress. so that's a difference from our past approach. so what we mean by that is pretty straightforward we want to see that the labor market conditions have moved -- have made substantial progress toward maximum employment and inflation made progress toward the 2% goal. that's what we want to see that obviously includes an element of judgment and we'll want to provide as much advance notice of any potential taper as possible so when we see that we are on track, data suggesting that we are on track to perhaps achieve substantial further progress we eelt say so and well in advance of a decision to

actually taper. >> if i could follow up on that. this shift in the dots, why wouldn't that suggest a weakening of the commitment here an awful lot of people shifted into 2022 it seems. >> i don't see that at all we have a range of perspectives on the committee i welcome that and we have -- we debate things, discuss things and come together around a solution but the strong bulk of the co committee is not showing a rate increase in this forecast period and as data improve, as the outlook improves very significantly seasons the december meeting you would expect forecast to move up it is probably not a surprise some people would bring in the estimate of the appropriate time for liftoff but the bulk of the committee, the largest part by far doesn't show a rate increase in this period

again, part of that is wanting to see actual data rather than just a forecast at this point. we do expect that we'll begin to make faster progress on both spending, labor markets and inflation as the year goes on because of the progress with the vaccines, because of the fiscal support we are getting we expect that to happen but we have to see it first >> great thank you. victoria >> talk about what you all are going to do this month which i'm happy to hear an update if you have one but sort of more broadly, do you think long term the ratio poses problems for monetary policy when the reserve supply is large. if so, do you think the changes to the leverage ratio are the way to deal with that problem?

>> victoria, we'll have something to announce on that in coming days. and i'm notgoing to expound upon your questions. why don't you ask another question if you'd like to because that's something in coming days. >> sure. okay then i'll ask about unemployment there's the unemployment rate is -- you all have projections for the u-6 rate and really emphasizing the fact that's not the only thing you are looking at are you all looking at ways of maybe adding to how you're projecting the unemployment rate to the summary >> let me say as we say in our statement, we look to a range of indicators on labor market we never only looked at the unemployment rate which is the only indicator of labor market outcomes that in the sep

we talk about participation, employment to population and the come by nation of the two, the different measures of unemployment so it's wages, it's the job flows. it's all of those things go into an assessment disparities of various groups and goes into an assessment of maximum employment the trying to incorporate that into the summary would not be practical. obviously the thing we do include is just did unemployment rate and that's an insufficient statistic so it doesn't include a lot of other thing that is we do look at and i wouldn't want to say that we look to include the other dozen things that we look at into the sep but from time to time we look at other things but i would just say the sep is a summary. it is one device and won't include all the things we look

at we talk about them all the time. so we're not looking actively at significantly broadening the indicators right now. >> thank you chris, associated press. >> thank you chair powell, i wanted to ask if i might, the forecast overall, you're forecasting very low unemployment rate next year. and in 2023. you have inflation or the fed overall is in the sep forecasting inflation at or above 2% by 2023. yet no rate hike in any of this forecast horizon is this telling us you see a higher inflation rate than projected or do you not -- as you have been talking about, the unemployment rate insufficient or what is this telling us about the fed reaction function that

it seems you are meeting the fed's dual mandate by 2023 and yet no rate hike expected. >> the first thing to say is that the sep is not a committee forecast it is not something we sit around and debate and discuss and approve and say this represents our reaction function as a committee it is a compilation of projections from different people but since we don't debate it or discuss it it would be hard to say why each participant did what they were going to do so all i would say about this is that we laid out what i think is very clear guidance on liftoff and it is labor market consistent with the conditions of maximum employment. we consider a wind range of indicators inflation that's reached 2% and not just on a transitory basis

inflation on track to run moderately above 2% for a period of time. the third has a little bit of an element of expectations in it. so we are determined to implement in guidance in a robust way it is chosen to implement the new framework and to meet the standards we need to see data as i mentioned. so what this -- what does this sep really say we are committed to the framework and the guidance we have provided to implement that framework. we will wait until the requirements set forth in the go guidance are met before considering a change the last thing i'll say is this. the state of the economy in two or three years is highly uncertain. and i wouldn't want to focus too much on the exact timing of a potential rate increase that far into the future. so that's how i would think

about the sep. >> thank you paul kirnen? >> thank you, chairman powell. my question is twofold how high are you comfortable letting inflation rise there's some ambiguity in your new tar getz as you mentioned, expectations driven. and do you think that that ambiguity might cause markets to price in a lower tolerance for inflation than the fed actually has thereby causing financial conditions to tighten prematurely? is that a concern? thanks. >> we have said we'd like to see inflation run moderately above 2% for sometime and we have resisted basically generally the temptation to try to quantify that part of that just is talking

about inflation is one thing actually having inflation run above 2% is the real thing so over the years we have talked about 2% inflation as a goal and not achieved it so we would like to perform that's what we'd like to do is get inflation moderately above 2% we haven't done it yet when we're above 2% we can do that i am -- look i would say this the fundamental change in our framework is that we were not going to act pre-emptively based on forecast for the most part and we are going to wait to see actual data and i think it takes peopl people time to adjust to that and we can only build the c credibility of that is by doing

that so that's how i would think about that. >> thank you matthew bosler. >> hi, chair powell. this is matthew with bloomberg news so there's widespread pre presumption will reach herd immunity do you think policy makers need to be doing more here to sort of align the herd immunity and full employment time lines, if you will thank you. >> on herd immunity, i am really going to leave that question to the experts. we don't control that we are not responsible for defining it. and we'll loev that whole discussion to the experts.

i mean, what we are focused on is the part that we control, which is the support that we provide to the economy there, we provided very clear guidance in the case of asset purchases, it's at their current level until we have made substantial further progress there is an element of judgment in that. therefore, we will supply clear communication well in advance of actually tapering. we just went through, you know, the criteria for raising interest rates they are very specific and you know, we are very much committed to having them fulfilled robustly i would agree with you that the path of the virus continues to be very important. we have these, you know, new strains which can be quite vir you len. we are not done yet. we are clearly on a good path

with cases coming down as i mentioned. but worry not done and i had would be negligent to take our eye off the ball before we are done. >> if i could briefly follow up, how do you see sort the disconnect in term of an economy that is expected to be widely reopen this year but full employment taking longer to achieve? is it the case that factors related to the virus will still be with us over the coming years? is that how to interpret the forecast >> i think there is some of that -- sure, there will be some of that. there will still be some social distancing people may be for example going into spaces that -- you know, that involve close contact with others some people will do that right away others will hold back. so i think there will be some of that in addition, though, remember, there are 10 million people -- in the range of 10 million people who need to get back to work and it is going to take time for that to happen

it can happen maybe more quickly than it has the past because it involves the reopening of a sector of the economy as opposed to stimulating aggregate demand and waiting for that to produce demand for workers it could be a quicker process. again, we don't know that. but it is just a lot of people who need to get back to work and it's not going to happen overnight. it is going to take some time no matter how well the economy performs unemployment will take a long time to go down. and so will participation. so that's all i can say. i think the faster, the better, we would love to see it come sooner than later. we would welcome nothing more than that. but realistically, given the numbers, it is going to take some time. >> thank you steve liesman. >> mr. chairman, thank you i wonder if you could -- kind of a three-parter here. all related. would you comment on the current level of the ten-year yield and some other long rates out there,

whether or not you think they would have a negative effect on the economy. and if not, is there a level that would give you concern in and finally the third part other central bankers expressed concern about what happened to yields in their countries and even some taken action but not you. could you give us your general orientation or idea of coming into the market and affecting a particular tenor of the bop market do you like it not like it. is that at the top of the tool box or bottom of the tool box. >> we are always attentive to market developments of course. we are still a long way from our goals and it is important financial conditions remain accommodative to support the achievement of those goals if you look at various indexes of financial conditions what you will see is they generally could show financial conditions overall to be highly accommodated and that is appropriate. that's how we look at it i would add, as i have said, i would be concerned by disorderly

conditions in market or by a persistent tightening of financial conditions that threaten the achieve men of our goals. we think the chance of monetary policy remains appropriate or guidance on the federal funds rate and on asset purchases is providing strong support for the economy. and we are committed to maintaining that patiently accommodative stance until the job is well and truly done >> could you give us an idea of how you sort of feel about that tool of being able to come into a particular part of the market either operating -- doing an operation twiggs or something like that? is that something you feel is at the top of the tool box or you don't prefer the tools we have. what i am telling you is stance of monetary policy we have today we believe is appropriate. we think our asset purchases this their current form, which is to say across the curve, $80 billion in tress reese, $40

million in mortgage backed securities on net, we think that's the place we could change them in a number of different areas should we deem it appropriate. for now we think that our policy stance on that is appropriate. >> thank you rachel siegel. >> hi, chair powell, thanks very much for taking my questions you have spoken about the pandemic's disproportionate toll on black americans, hispanic americans, asian americans, and other groups in the labor market and i am curious if you can speak to specific indicators that the fed will be using to measure job gains for groups that have persistently higher rates of unemployment compared to whyte americans and relatedly, sense you described vaccines as key to the recovery is that of concern if communities of color is this what barriers do you believe exist there? >> which measures. we do monitor and communicate

very regularly about different labor market -- disparities in the labor market let's say the african-american unemployment rate is you be substantially elevated so is the hispanic unemployment rate we look at those and we see those as -- it has blackened the labor market it is sad to see because those disparities had really come down to record lows since we started keeping the data that way as recently as a year ago february of last year we had those disparities quite low. what happens in a downturn is they move up at twice the speed of white unemployment. we monitor those our tools affect unemployment wholly but we look at those as a form of slack in the labor market and hope there is progress there this particular downturn of course was just a direct hit on

a part of the economy that employs many minority and lower paid workers the public-facing workers in the service industries in many cases don't have a lot of financial assets they are not tremendously well paid they might have other jobs and things like that so this was a direct hit on that part of the economy. and it is the slowest part of the economy to recover you though, we would like to see those people continue to get supported as the broader economy recovers, which it's very much doing now n. terms of disparate levels of vaccination, that's -- those are facts, unfortunate fact they are really not something we have within our policy tool kit to address but it is true, though, the data would suggest there are significant disparities between different ethnic groups. and -- but that's not for us that's for fiscal authorities and the government more generally to work on. >> thank you gina smallic

>> hey, chair powell, thanks for taking our questions i was wondering if you could talk a little bit about how you see the fiscal policy support that has come down the line affecting the economy's potential in the longer term just in the sense that you have talked a lot about the potential for market scarring and how that might weigh on our future prospects. and i wonder whether you see that sort of working in reverse. if we pull people back into the labor market more quickly, will that improve our chances >> so i do think that fiscal policy overall will have really helped us to avoid much of the scarring we were very, very concerned about at the beginning. i think that's just the size and the speed at which congress has delivered, you know w the c.a.r.e.s. act, and since then, has -- it's going to wine up very much accelerating the return to full employment. it's going to make a huge

difference in people's lives and it has already as i mentioned in my remarks -- opening remarks, the. >> referee: roe has been faster tan we expected. part of that just is very hard to predict given we have never seen an even like this part of it is just the strength of the fiscal response which i think will look good over the years. longer term, you know, to -- that -- the first part is about avoiding scarring. i think we have not avoided all of the scarring but we probably avoided the worst cases there. and i hope we keep at it -- we will keep at it with our policies of course to do everything we can to make sure that that continues. longer term, though, what it takes to drive productive capacity per capita or per hour worked to raise living standards overtime is investment, investment in people's skills and apartment attitudes, vemt in plant equipment, in software it takes a lot of investment to support a more productive economy an